Quebec was Canada's most heavily taxed province in 2017

Quebec’s tax rate as a percentage of its GDP came in at 37.2 per cent. (Getty Images)

Quebec was Canada’s most taxed province in 2017, while Saskatchewan residents enjoy the country’s lowest tax burden when compared to its GDP, according to a new Université de Sherbrooke report.

Quebec’s tax rate as a percentage of its GDP came in at 37.3 per cent, more than the rest of the country as well as the federal rate. Nova Scotia’s tax rate was the second highest in Canada, at 36.2 per cent, followed by Ontario’s, at 34.1 per cent.

Saskatchewan boasted the country’s lowest tax rate as a percentage of GDP, at 27.1 per cent. Alberta had the second lowest rate at 28.6 per cent, while Newfoundland and Labrador had the third lowest at 29.8 per cent.

Canada’s tax rate of 33 per cent was slightly below both the average of OECD countries (34.2 per cent) and the average of G7 nations (35.7 per cent.) But, the tax rate was above its North American neighbours, with the United States tax burden as a percentage of GDP coming in at 27.1 per cent.

The report noted that there are three groups emerging among the Canadian provinces. The first is made up of oil-producing provinces where the tax rate is lowest. However, the report says the gap between these provinces and the rest of Canada has narrowed significantly since 2008, as the tax burden has also increased within those provinces. The next group is the five provinces who have rates similar to the rest of Canada, and the third consists of Quebec and Nova Scotia, which have significantly higher rates than the rest of the country.

Between 2008 and 2017, the tax rate increased in nine of the 10 provinces. Newfoundland saw the biggest jump, at 8.6 per cent, followed by Alberta (3.8 per cent), and Saskatchewan (2.9 per cent.) Prince Edward Island was the only province that saw its rate fall in that same period, by 0.4 per cent.

The report, written by the University’s Chair of Taxation and Public Finance, noted that Quebec’s tax burden is closer to that of European countries than to its North American neighbours. France is among the world’s most taxed nations, with a tax burden of 46.2 per cent, followed by Denmark (46 per cent) and Belgium (44.6 per cent).